TEXTON PROPERTY FUND LIMITED - Sale of Woodmead Commercial Park retail asset

Sale of Woodmead Commercial Park retail asset

TEXTON PROPERTY FUND LIMITED
Granted REIT status by the JSE
(Incorporated in the Republic of South Africa)
(Registration number 2005/019302/06)
JSE share code: TEX ISIN: ZAE000190542
(“Texton” or the “Company”)

SALE OF WOODMEAD COMMERCIAL PARK RETAIL ASSET

1. INTRODUCTION
   The board of directors of Texton (the “Board”) is pleased to advise shareholders that the Company (the
   “Seller”) has entered into an agreement with Benav Properties Proprietary Limited (the “Purchaser”) on
   12 May 2022 (the “Agreement”) to dispose of Woodmead Commercial Park located in Woodmead,
   Johannesburg (the “Disposal” or the “Property” or the “Sale”)

2. RATIONALE
   Texton has received an offer for the Property at a premium to its last disclosed book value. Post the sale
   of the Golddurb Retail Asset announced on SENS on 10 December 2021, Texton has limited exposure to
   retail assets in its direct property portfolio. As such the Board has decided to exit the sector to focus on
   repurposing its office assets and pursue its SME strategy.

    The proceeds of the Sale will be utilised to repay debt and invest to further develop its SME strategy.
    Furthermore, the recycling of capital will provide flexibility for future opportunities to diversify investment
    into other asset classes which appear attractively priced.

3. TERMS OF THE SALE

    The purchase price payable is R132.5 million (the “Sale Consideration”) and will be settled in cash and
    with the provision of a vendor loan. The vendor loan will be R20 million and has the following terms
    associated with it:
     - The loan is subject to a 36 month term
     - 50% of the loan is repayable after 24 months
     - The remaining capital balance is payable at the end of the term of the loan being 36 months
     - The interest rate of the loan is prime plus 4%
     - Interest is serviced monthly.

The Sale is subject to the following condition precedents (“Condition Precedents”):
     - the Purchaser confirms that it is satisfied with its due diligence investigation undertaken in respect of
       the Property by no later than the 2nd June 2022;
     - by no later than the 26th of June 2022 the Purchaser receives written confirmation that it has been
       granted loan funding on standard terms and conditions typical for a transaction of this nature; and
     - finalisation of all requisite Seller board approvals
     - finalisation of the required finance documents associated with the vendor loan.

    The effective date of the Disposal will be the date on which all Condition Precedents have been fulfilled
    and the transfer date will be the date of registration of transfer of ownership of the Property.

    All other terms of the Agreement are standard terms and conditions typical for a transaction of this nature.

4. FINANCIAL AND PROPERTY SPECIFIC INFORMATION
   Details of the Property are as follows:

     Location             Sector    GLA (m2)      Weighted        Net rental         Book              Sale
                                                   average          income          value     Consideration
                                                     rental          (R) PA     (R million)      (R million)
                                                 (R/m2) per
                                                    month
     17 Waterval           Retail     13 197        R92.01     R14 144 527(1)       114.300(2)         132.500(3),
     Crescent
     South,
     Woodmead,
     Sandton, 2191

Notes:
1. Unaudited net rental income attributable to the Property for the six months ended 31 December 2021
   was R6 841 411
2. Audited book value as at the year ended 30 June 2021
3. The Sale Consideration in respect of the Property is considered its fair market value, as determined
   by the Board. The Board is not independent and are not registered as professional valuers or as
   professional associate valuers in terms of the Property Valuers Profession Act, No. 47 of 2000.
4. The financial information contained in this announcement has not been reviewed or reported on by a
   reporting accountant.

5. CATEGORISATION OF THE SALE
   The Sale is a category 2 transaction in terms of the JSE Listings Requirements and accordingly does not
   require approval by Texton shareholders.

SANDTON
13 May 2022


CORPORATE ADVISER AND SPONSOR TO TEXTON
Investec Bank Limited

Date: 13-05-2022 04:45:00
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